Aug 11, 2014

ISIS seizes factory that produces chemical WMDs: Iraqi government reports it just lost control of a chemical weapons facility. ISIS (now called the Islamic State, or IS) seized the Muthanna facility outside Baghdad on June 11. The very next day, using onsite surveillance cameras, facility managers spotted terrorists looting project equipment and appliances.

In short, ISIS has added chemical WMDs to its growing arsenal of advanced, modern weapons.

Russia pumps up military 'exercises' along Ukraine border: Russia previously announced it will conduct military exercises on its border with Ukraine. Now the Russians are upping the ante. They said the exercises will include real missile firing practice; and will test the coordination between aviation anti-missile defenses. Russia's latest bomber, the SU24, will take part. Also, its SU27 and Mig 31 jets will carry live ammo.

Ukraine escalates war buildup: In preparation for Russia's war games, Ukraine's government announced it is deploying tactical missile launchers and military rocket launcher systems near Donetsk. The systems include the Smerch Tornado and the Uragan Hurricane Multiple Launch rocket systems. Who knows how much rocket fun they will have in the August sun?

US planes required to fly at least 30,000 feet over Iraq: The FAA now requires US airlines to fly at least 30,000 feet over Iraq. That height keeps them safe from shoulder-held rocket and low altitude launchers. FAA cited the potentially hazardous situation created by the armed conflict.

US bombing its own artillery (that ISIS stole): Two US F/A-18 warplanes dropped 500 pounds of laser-guided bombs on mobile artillery units used by IS (ISIS) fighters in Iraq. The media forgot to point out a key fact, that has game-changing ramifications for the entire conflict: the F/A-18s dropped those bombs on artillery pieces the US made and gave to Iraq. IS (ISIS) not only seized the equipment: it somehow gained the knowledge to use it very skillfully.

ISIS seizing critical oil boom towns in Iraq:IS is fighting, winning and taking control of many oil boom towns in Iraq. The city of Arbil, with its population of 1.5 million people, is one example. Western oil companies worked out of Arbil, when the rest of Iraq was too dangerous for foreign staff. Now ISIS is within 20 miles of the city limits, as 500,000 refugees have flooded into its gates.

Another John 'Clueless' Kerry statement: US Secretary of State John Kerry said, “the stakes for Iraq's future cannot be clearer. IS's campaign of terror against the innocent, including the Christian minority, and its grotesque targeted acts of violence bear all the warning signs of genocide.” This nut is out of his mind. Can there be any question of whether this is genocide?

US government claims great humanitarian aid – but people supposedly receiving it say they get nothing: The US Defense Department claims that planes dropped 72 bundles of supplies, including 8000 ready to eat meals, and thousands of gallons of drinking water, for civilians threatened near Sinjar. These people are known as the Yazidis. 250,000 of them are stuck on Sinjar Mountain. Yazidis believe this is a holy site, where Noah's Ark settled after the flood.

The Yazidis, responding on social media, said “we hear through the media there is American help. But there's nothing on the ground,” reports Reuters in Baghdad. “Please save us! SOS. Save us. Our people are exposed to genocide.” Maybe the MRIs ended up by some of the IS's seized American artillery.

Violence spreading to Yemen: a group of al-Qaeda militants attacked a security checkpoint on a main road in the Hadramout Province in eastern Yemen. Killed 9 soldiers. That's after a similar attack killed 3 soldiers in the southern Shabwa province. Al-Qaeda is imposing Islamic law on parts of Hadramout.

US crude oil exports jumped 35% in June: to 389,000 barrels a day. That is the highest level since 1950. The increase of more than 100,000 barrels a day is the biggest since the onset of the shale oil revolution.

Kurdistan soon to fall: Kurdistan is also on the list of countries we expect to soon fall to IS.

WHO declares Ebola epidemic an international health risk: For many years we feared a bird flu pandemic. One fact saved us from that horror: the flu never mutated to person-to-person transmission. But now Ebola, one of the most contagious infections known to man, is spreading by leaps and bounds. So far it mostly affects the poorest nations on the planet. But in what will go down as the biggest medical mistake in history, WHO did not demand that infected countries be quarantined or even isolated. Liberia has already declared a state of emergency: dead bodies are left rotting in the streets, dragged and left their by members of their own families who fear contracting the disease.

More serious economic fallout from Ukraine crisis: Metinvest, Ukraine's largest steel maker, with 40% of Ukraine's steel output, said it will no longer accept new orders from buyers. The company announced that, until the situation becomes clear, it decided to stop taking new orders. Instead the company will focus on fulfilling existing orders. Till now, Metinvest was the world's 5th largest steel exporter.

US LNG exports to soar: LNG (liquid natural gas) sells for $10.50 per MM BTUs in Asia. In the US it sells for under $4 per MM BTUs. The Cameron LNG terminal has received final investment approval: $7.4 billion in financing has been lined up.

At the same time, the US Dept of Energy issued conditional approval fort American firms to export LNG to Japan; and the US Federal Energy Regulatory Commission has given permission to build and operate 3 train gas liquidization facilities. Each train has capacity for 4 million tonnes per year, i.e. over 12 million tonnes in all.

In search of a medical cure for Ebola: The rush is on to find medicines that can treat Ebola. Companies that have promising drugs in the pipeline includ MAPP BioPharmaceuticals... Takmira Pharm... and Profectus Biosciences.

Profectus chief scientific officer John Eldridge said, “for years we told the government you need to invest a little bit of money in this. And now it's 'oh my god how fast can you make this?'”

Ebola is preventable and will be curable. Let's hope the race to find widespread treatments doesn't become a case of too little, too late.

Dollar rising against euro: Investors the world over are flocking to the dollar and US government debt. The euro is now trading at a nine-month low; and bullish bets on the dollar are escalating on foreign exchanges. I sure hope you made the dollar/euro trade I recommended.

Poland warns about Russian invasion of Ukraine: Polish Prime Minister Donald Tusk said, “we have reason to suspect – we have been receiving such information the last several hours – that the risk of direct intervention by Russian military in Ukraine is for sure higher than it was several days ago.” Duhh!

More German economic weakness: German industrial output rose just 0.3% in June. That's after a 1.8% drop in May. 2nd quarter was the weakest in three years, down 1.5% compared to 1st quarter.

Italy officially in recession (again): For the 3rd time since 2008, Italy sank into a recession. April to June, the economy shrank -0.2%. January to March, down -0.1%.

Since 2011, Italy has only had one quarter of economic growth: it expanded a tiny 0.1% in last quarter of 2013. Italian officials, clearly members of the optimists club, predict growth of 0.8% in 2014.

NATO proves uselessness, warns birds can fly: NATO warns 20,000 Russian troops amassed on Ukraine's eastern frontier create a dangerous situation. No kidding? The fact is, Moscow could use humanitarian concerns as a pretext to send troops across the border.

The lie behind the gain in 2nd quarter US GDP: The Commerce Department reported that US 2nd quarter GDP rose 4%. That was after GDP fell 2.9% in 1st quarter. We found most of that growth was because wholesale inventories soared 7.9% from June, 2013. This is not good news. When wholesale inventories climb, it means goods are not selling; and manufacturers are forced to warehouse them.

Russia/US/EU trade war snowballing:Russia announced it will ban all food imports from the US, and all fruit, vegetable and cheese imports from Europe. This is called a trade war. Sooner or later the Russians will get around to the oil trade.

Greek unemployment higher than at worst time of Great Depression: Greek unemployment dipped to 27.2% in May. Let's break out the champagne: it fell from 27.3% in April! This rate is still at record highs, worse even than during the highest rates of the Great Depression.

Eurozone unemployment overall is 11.6%.

Another multi-billion euro European bank bailout: Portugal's 2nd largest bank, Banco Espirito Santo, will get a 5 billion euro rescue bailout. Junior bondholders and shareholders will take a huge loss. Europe is filled with banks like Banco Espirito Santos. This should start the next round of European bank wipeouts.

US trade deficit fell to a three-year low in June: Down 7% to $41.5 billion. Before the oil boom, the trade gap was running $100 billion per month, on the rise. Now it has dropped by more than half. June imports fell 1.2%, as oil imports continue to plunge. Thank god for fracking.

EU's sanctions against Russia will severely damage Finland's economy: Finland Prime Minister, Alexander Stubb, said Finland could face an economic crisis because of EU sanctions against Russia. Stubb said Helsinki will seek financial compensation from the EU if sanctions disproportionately damage the Finns. Russia is Finland's largest trading partner.

Nearly all new jobs in Obama 'recovery' are low-paying, part-time employment: 70% of all jobs created in what Obama calls the 'recovery economic miracle,' have been part-time jobs in two industries: restaurant and hospitality. i.e. hamburger flipper and toilet bowl cleaner. Making things even worse, most of those jobs are believed to be taken by undocumented workers. Have a nice day!

ISIS close to taking Baghdad: using secret tunnels built by Saddam Hussein, IS insurgents are getting dangerously close to Baghdad. Heavily armed Sunni tribesmen now support IS. IS is making great headway in the rural areas just south of Baghdad in the rugged Euphrates valley. The US is finally waking up and taking notice.

Lebanon about to fall to ISIS: The Lebanese army faces serious fighting in Arsal, a town not far from the Syrian border. Lebanon will fall to IS, right after Syria does.

Two-star American general killed by local jihadist in Afghanistan: General Howard Green was shot 4 times in the back. The Afghan who killed him had served in the Afghan (not al-Qaeda) army for three years. Green is the most senior US military officer killed in action since the Vietnam war. Giving new meaning to not knowing who your enemies are.

US Midwest business index plunged: it dropped from 62.6 in June to 52.6 in July. The largest drop since the economic wipeout in October 2008. Not a good sign.

Nations globally withdrawing their embassies from Libya: Britain announced it will close its embassy in Tripoli, Libya. Like the US and virtually every other nation, Britain is abandoning the war-torn nation.

US job growth slowed in July: and the unemployment rate rose. Nonfarm payrolls only increased 209,000, after surging 300,000 in June. Again, most of these jobs are either part-time or service (read hamburger flipper) oriented.

US CPI in June rose just 0.1%: on top of which, US import prices rose just 0.1%; while exports fell 0.4%. For all intents and purposes, inflation in the US is dead and buried.

US labor force participation rate falling:BLS (Bureau of Labor Statistics) announced the US labor force participation rate was a tiny 62.9% in July. U6 unemployment rate rose to 12.6%. With 92 million adult Americans not working... with the labor participation rate dropping to historic lows... the US economy has not improved an iota.

Japanese economy sinks deeper into decade-long depression: Japan reports industrial production sank 3.3% in June from May. June exports also plunged, down 2%. The Japanese depression keeps getting worse.

Another sign that in reality the US economy is falling, not growing: June U.S. building permits were down 4.2% from May. Housing starts dropped 9.3%. These stats flatly contradict the fantasy out of the Obama administration that US GDP rose 4% in second quarter.

PPI near zero: U.S. PPI rose 0.4% in June. The core rate, less food and energy, was up 0.1%. Continuing the multi-year proof that inflation is nonexistent.